Professional Documents
Culture Documents
133749 August 23, 2001 agreed to sell the property to him, he had not
paid the consideration stated in the first deed.
HERNANDO R. PEALOSA alias "HENRY
PEALOSA," petitioner, Thereafter, Henry and Severino executed
vs. another deed of absolute sale7 (second deed)
SEVERINO C. SANTOS (deceased), Substituted by for a higher consideration of P2,000,000.00.
his heirs: OLIVER SANTOS and ADYLL M. SANTOS, Although the second deed was originally dated
and ADELA DURAN MENDEZ "August 1988", superimposed upon the same was
SANTOS, respondents. the date "September 12, 1988". This second deed
was signed by both parties and duly notarized. It
QUISUMBING, J.: states that Severino sells and transfers the house
and lot to Henry, who had paid the full price of
P2,000,000.00 therefor.
Petitioner appeals by certiorari from the decision
of the Court of Appeals, which affirmed the
judgment of the Regional Trial Court of Quezon Severino explained that his initial asking price for
City, Branch 78, in Civil Case No. Q-92-13531, the property was only P1,800,000.00 as shown in
declaring the deed of absolute sale entered into the first deed. But he later asked for a higher
between petitioner and respondents as void and price because Henry could not give the money
inexistent and ordering petitioner to vacate the as soon as expected. However, Severino claimed
subject property and to pay reasonable that he made it clear to Henry that he agreed to
compensation for its use. sell the property under the second deed for
P2,000,000.00, provided that payment be
immediately effected. Severino said that he
The facts, as revealed by the records, are as
wanted to use the money to invest in another
follows:
property located in Alabang and told Henry that
if payment was made at a later date, the price
Respondents Severino C. Santos (deceased) and would be the current market value at the time of
Adela Mendez Santos are registered owners of a payment.
residential house and lot located at No. 113
Scout Rallos Street, Quezon City under TCT No. PT-
Henry then gave Severino P300,000.00 as "earnest
23458 (54434).1 In 1988, Severino and Adela
money", purportedly with the understanding that
decided to sell their property and for this
the former was to pay the balance within 60
purpose, negotiated with petitioner Hernando (or
days. Otherwise, said amount would be forfeited
Henry) Pealosa. The property was then
in favor of Severino.8 The latter also maintained
occupied by a lessee, Eleuterio Perez, who was
that he signed the second deed only for the
given preference to buy it under the same terms
purpose of facilitating Henry's acquisition of a
offered by the buyer.2 Perez proposed less
bank loan to finance payment of the balance of
favorable terms3 and expectedly, Severino
the purchase price9 and added that execution
rejected his offer.
of the second deed was necessary to enable
Henry to file a court action for ejectment of the
On August 1, 1988, petitioner Henry Pealosa and tenant.10
respondent Severino Santos attempted to enter
into an agreement whereby the latter, for a
After execution of the second deed, Henry filed
consideration of P1,800.000.00, would sell to the
a loan application with the Philippine American
former the property subject of the instant case.
Life Insurance Company (Philam Life) for the
The deed of absolute sale4 (first deed)
amount of P2,500,000.00.11 According to Henry,
evidencing this transaction was signed by Henry
he had agreed with Severino during the signing
but not by Severino, because according to the
of the second deed, that the balance of
latter, Henry "took time to decide" on the matter.5
P1,700,000.00 would be paid by means of a loan,
with the property itself given as collateral.12
On August 15, 1988, Henry signed a
document6 stating that the first deed was
Meanwhile, on the strength of the first deed and
executed between him and Severino, for the sole
as new "owner" of the property, Henry wrote a
purpose of helping the latter eject Perez, the
letter13 dated August 8, 1988 to the lessee,
occupant of the property. Henry acknowledged
Eleuterio Perez, demanding that the latter
in said document that although Severino had
vacate the premises within 10 days. Failing in this
effort, Henry brought a complaint for
ejectment14 against Perez before the Office of P700,000.00 for the renovation, as evidenced by
the Barangay Captain. receipts.20
On September 1, 1988, a Certification To File On July 27, 1992, Severino sent a letter21 to Henry,
Action15 was issued by the barangay lupon. This through counsel, demanding that Henry vacate
led to the subsequent filing of Civil Case No. 88 the house and lot, on the ground that Henry did
0439 for unlawful detainer, before the not conclusively offer nor tender a price certain
Metropolitan Trial Court of Quezon City, Branch for the purchase of the property. The letter also
43, entitled "Henry Pealosa, Plaintiff vs. Eleuterio stated that Henry's alleged offer and promise to
Perez, Defendant". Claiming that he still had a buy the property has since been rejected by
subsisting contract of lease over the property, Severino.
Perez countersued and brought Civil Case No. Q-
88-1062 before the Regional Trial Court of When Henry refused to vacate the property,
Quezon City, Branch 96, entitled "Eleuterio Perez, Severino brought this action for quieting of title,
Plaintiffs vs. Severino Santos, et. al, Defendants". recovery of possession and damages before the
In this latter case, Perez assailed the validity of Regional Trial Court of Quezon City, Branch 78,
the sale transaction between Henry and Severino on September 28, 1992. Severino alleged in his
and impleaded the former as co-defendant of complaint22 that there was a cloud over the title
Severino. to the property, brought about by the existence
of the second deed of sale.
While the aforesaid court cases were pending
resolution, Philam Life informed Severino through Essentially, Severino averred that the second
a letter,16 that Henry's loan application had been deed was void and inexistent because: a) there
approved by the company on January 18, 1989. was no cause or consideration therefor, since he
Philam Life stated in the letter that of the total did not receive the P2,000,000.00 stated in the
purchase price of P2,500,000.00, the amount of deed; b) his wife, Adela, in whose name the
P1,700,000.00 would be paid directly to Severino property was titled, did not consent to the sale
by Philam Life, while P800,000.00 would be paid nor sign the deed; c) the deed was not
by Henry. registered with the Register of Deeds; d) he did
not acknowledge the deed personally before
The release of the loan proceeds was made the notary public; e) his residence certificate, as
subject to the submission of certain documents in appearing in the deed, was falsified; and f) the
Severino's possession, one of which is the owner's deed is fictitious and simulated because it was
duplicate of the Transfer Certificate of Title (TCT) executed only for the purpose of placing Henry
pertaining to the property. However, when Henry in possession of the property because he
and Severino met with officials of Philam Life to tendered "earnest money". Severino also claimed
finalize the loan/mortgage contract, Severino that there was no meeting of minds with respect
refused to surrender the owner's duplicate title to the cause or consideration, since Henry's
and insisted on being paid immediately in varied offers of P1,800,000.00, P2,000,000.00, and
cash.17 As a consequence, the loan/mortgage P2,500,000.00, were all rejected by him.
contract with Philam Life did not materialize.
For his part, Henry asserted that he was already
Subsequently, on April 28, 1989, judgment18 was the owner of the property being claimed by
rendered by the MTC-QC, Branch 43, in Civil Severino, by virtue of a final agreement reached
Case No. 0439, ordering the tenant Perez to with the latter. Contrary to Severino's claim, the
vacate and surrender possession of the property price of the property was pegged at
to Henry. In said judgment, Henry was explicitly P2,000,000.00, as agreed upon by the parties
recognized as the new owner of the property by under the second deed. Prior to the filing of the
virtue of the contract of sale dated September action, his possession of the property remained
12, 1988, after full payment of the purchase price undisturbed for three (3) years. Nevertheless, he
of P2,000,000.00, receipt of which was duly admitted that since the signing of the second
acknowledged by Severino. deed, he has not paid Severino the balance of
the purchase price. He, however, faulted the
Upon finality of said judgment, Henry and his latter for the non-payment, since according to
family moved into the disputed house and lot on him, Severino refused to deliver the owner's
August 1989, after making repairs and duplicate title to the financing company.
improvements.19 Henry spent a total of
On Aug. 20, 1993, the trial court rendered On December 29, 1997, the appellate court
judgment in favor of Severino and disposed: affirmed25 the judgment of the trial court and
thereafter, denied Henry's motion for
WHEREFORE, judgment is rendered as reconsideration.26 Thus, Henry brought this
follows: petition, citing the following as alleged errors: